>> what i think we are all mainly a worried about is a fed policy mistake. >> inflation is popping up as the main problem facing the fed, which hasn't been true for years. >> powell has also put a big focus on employment. >> fed forward guidance in this new world just can't go as far as it did in the past. >> i think the fed won't act for a long time. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: fighting inflation was an oil dump, but prepare for the data dump. good morning. this is "bloomberg surveillance

." jon ferro off. kailey leinz very much in. the issue you have raised, and rightly so, is what will the effect be on price. tom: the units, will it be this some total we just heard from julian lee? it is a global effort. that is unique, a little bit different than what we have seen before with the spr. price beats all, and i will call it a churn moving brent crude down to an $80 level moments ago. lisa: fighting inflation the key issue for so many of these nations, more acutely felt perhaps in the united kingdom, but here in the united states, a political potato as we get the pce data that is key for the federal reserve. tom: i would also note it is a gallon of gas, and the answer is it reacts slowly.

the price of oil is out front of a gallon of gas. kailey: it has a trickle-down effect. it is not an immediate impact. the american consumer facing higher prices at the pump as they try to load up and head out for the holiday here in the u.s., they are not going to file immediately, so it may not be the boost in terms of the support president biden is hoping to get today. lisa: the issue we have, the idea of policymakers trying to fight the free markets, there is this feeling that we have increasingly that policymakers want to control exactly how markets respond to things and how quickly or slowly inflation picks up. they are continually humbled, and i think that is one of the reasons people are soap skeptical of the -- are so skeptical about the ability to edge out of this period amid an increase in inflation. this is the reason for some of the hysteria of greg valliere earlier this morning.

tom: with that said, let's describe the divide. mohamed el-erian over to priya misra in toronto watching the maple leafs play. the divide is between -- the divide between misra and el-erian is grand canyon wide. lisa: it means the household is unable to 19 there quality-of-life, that will slow growth at a time of elevated asset price. i think it is important to reframe the debate in that way. tom: spx down a little bit. dow up 24 points. i am not sure where the market's are going, but big tech with a two day pause in the ascent that we see. nasdaq 100 year to date larger than the s&p 500. that, some would say, is extraordinary.

it is a stronger dollar with dxy 96.54. bloomberg dollar index agrees with that. euro not part of the story today , $1.1246. we had a stronger lire in the last 10 minutes out from the shock of 13.400, even 13.50. we will finish with oil, seven hicks dollars $.32 on west texas and -- $76.32 on west texas intermediate. patrick armstrong joins us now, plurimi wealth management. how do you make common sense out of this to address an investment plan going forward? patrick: there's a lot happening this tuesday. anytime policymakers, governments, any entity tries to get involved and influence the price of an asset, it should make you a buyer of that asset

because these types of actions generally work in the short-term, but they don't work in the long term. you can't fight market forces and the price of oil if you look at what is going to be released from the reserves. you're looking at probably 60 to maybe 100 million barrels total over the space of two months. that is not massively material when you look at 100 million barrels of oil being consumed every day, when there's 97 million, 90 8 million barrels being produced everyday. there have an individual -- there have been inventory drawdowns. it makes perfect sense if you are a politician to probably release these, get the oil price down a little bit in the near term potentially, and buyback those same barrels on the futures curve at $60. contracts are trading at $60, so selling at $80, buying at six dollars, and you can rebuild the reserves and hedge that way as well. kailey: the politically oriented

move because of the optic the run inflation, does that mean you are in the camp where all of the inflation concern may be a bit overblown at this point? patrick: not at all. i think inflation concern, it is not transitory. transitory means a short duration, and what powell said this month is when central banks say transitory, it means not permanent in duration. that gives him a very long window for it to be transitory. i don't think the forces that have led to inflation are disappearing. you have seen covid really disrupt supply, economies reopening, really impacting demand. you've had an explosion of money supply. when you have money supply growth growing at 15%, the amount of goods roughly unchanged, the path of least resistance is higher prices. all those things coming together , there's things happening there pushing prices higher. lisa: how do you frame this for

people who accuse the media of hysteria around inflation, who accuse people of taking a look at how much prices have gone up and extrapolating that out to a rate of inflation that is consistently this high? how do you say the real issue is something other than 1970's, it is this picture? patrick: i don't think it is like the 1970's. in europe, it could turn into some thing on that because of natural gas, because of energy prices. that could be a massive stagflationary shock if the geopolitical situation with russia deteriorates and some of the warnings the u.s. is putting out about russia amassing troops, those kind of things. but i am talking about non-transitory meaning persistently above the fed's 2% target, so more like in the range of six present now, falling towards 3% over the next 48 months, things like that. it will be a burden for consumers. it won't be a game changer licked the 70's, i don't think,

without a geopolitical shock or some big supply shock. tom: in your note, you go back to first principles, the top of the income statement and say let's look at the value of these indices on a price to sales basis. discuss that. how out of whack are we on a price to revenues basis? patrick: you can't really fudge revenue so easily with accounting tricks. sales or sales. you can book some revenues a little bit earlier, but today the msci world is trading at 2.4 times sales. the s&p 500 is trading at three times sales. the nasdaq is trading at 5.4 times sales. those are big multiples. you've got massive profit margin right now, massive cash generation from some of the companies that lead to those higher multiples, so it is somewhat justified. but in 2008, the market was trading at a little over one times sales, so that is a 60%

drawdown from where multiples are today if we go back to those kind of risk aversion measures where profitably is curtailed, higher inflation and stagflation would trigger that if it was accompanied by a hawkish fed. i don't think anything like that happens, but it is completely unprecedented. lisa: how much would the fed have to raise rates at this point to threaten some of those multiples? patrick: i think it is driven by the 10 year yield, and when the fed gets a little bit too dovish which i think they will next year, if my base case of stickier inflation proves true, if they don't hike, you might see the 10 year start going higher as bond vigilantes come in, and that is really the driver of multiples. if you do start seeing the 10 year yield move past 2.5 and that move past 2.5%, you go from negative real yields to positive real yields potentially, and i think that would be the game changer for the higher multiples. tom: patrick, thank you so much.

patrick armstrong, plurimi wealth management. i haven't heard that phrase in at least hours, bond vigilantes. where are the oil vigilantes? [laughter] lisa: where are the people looking at what the u.s. is doing, what china is doing, and south korea and india, and saying it is not going to matter for more than a day. they are coming out and saying that. that is what we are seeing in markets, people retrace some of this move. a lot of is muddy -- a lot of it is muddy, too. tom: i did the mass, and like i said, it is in the vicinity of. good morning, alison krauss. it is in the vicinity of selling douglas $.58 in england -- of $7.58 in england. those are numbers americans aren't used to. kailey: what that means is it is being felt by consumers on other side of the atlantic, but consumers in the u.s., too. it is still the highest we have seen in seven years, so real people are feeling it.

do your point about whether or not it actually has an impact, is it so much about the actual impact on what a gallon of gas costs to you, or is it just about the palooka perception? tom: look at you with the jon ferro talk, a liter of gas. [laughter] kailey: i can't talk about european football. tom: i find it fascinating. it is like reliving the 1970's again. lisa: be careful with that because then people are going to start saying you're saying the 1970's, and that is a trigger for a lot of people right now. tom: the vw rabbit diesel, that worked out. kailey: i want a vw bus. tom: wendy schiller on the politics of the nation. we do that next on bloomberg radio and bloomberg television. ♪ ritika: it is an unprecedented

coordinated attempt by some of the world's largest oil consumers to tame prices. the u.s. will release 50 million barrels of crude from its strategic petroleum reserves, and concert with japan, china, india, and korea. president biden is reportedly considering whether to send american military advisers to ukraine. according to cnn come of the u.s. is also looking into sending more weapons to ukraine, including handheld antiaircraft missiles. russian forces on the border of ukraine posed a threat of invasion. the kremlin denies any aggressive intentions. -- purchases marks the slowest rate of the year. china has now reached just 56% of its two-year goal of three under 70 $8 billion. the biden administration has

been pushing beijing to live up to its commitment. in turkey, president erdogan's vow to cut interest rates has sent the lira into a freefall. in november alone, the lira has lost almost 1/3 of its value. the latest plunge came after president erdogan defended the move. best buy posing better-than-expected third-quarter earnings, but also a drop in its gross margin. that i could similar declines at walmart and target. that is why stocks have risen 31% since october 1. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪ this is bloomberg. ♪

>> the prices are high now, no question, and that is affecting american consumers. at the same time we are looking

at the actions we can take as an administration to try to address those. on the issue of gas prices, we have been very focused. the president is going to talk more about that over the coming days. tom: brandy's managing the white house mess -- brian deese managing the white house message on a day when the president releases the strategic petroleum reserve to bring the price of oil down. we see west texas intermediate down zero dollars 18 tenths, down in the last number of debt -- $0.18, down in the last number of days. it is time to stop and actually get perspective. you can always do that with wendy schiller. to say she is of brown university barely describes her contribution to the discourse of american politics. i want to go to david morales, the youngest graduate in the history of brown university's acclaimed public affairs masters program. david morales' mother

picked vegetables, and he ended up with a prestigious degree from your shop. he is a represented from the seventh district of rhode island. he speaks senator warren speak. he speaks senator sanders speak. what happens to the futures of liberals in america and that five or 10 years in the democratic party? wendy: i wouldn't call it all out war, but there is a reckoning coming with the party because the party needs higher turnout among people who we used to say were young, 18 to 25 or 18 to 29, but that generation is now 35 years old. it is not just young people. and they need people to vote, and that core of people is highly decided fight with leadership, and they believe government should do more to take care of basic human needs. that is what they believe, and that is why there has been this long, drawn out fight over this reconciliation package or

whatever you want to call it, build back better, that the government should provide more help to live a decent, basic life. you say how do you pay for that, and they don't really want to hear it. tom: what is the percentage that is liberal in america? do you have a working number in your head? wendy: it is an interesting thing. people really ask about party affiliation more. do you consider yourself a liberal or conservative, and which party do you belong to. that is the way they word the question. i think most of them say they are moderate, so then they save i am an independent, or a democrat or a republican. i think true liberalism is generational. what was a liberal in the 1970's or in a teen 80's is not a liberal today, and that is the big disconnect. the thing thing happened, i hate to bring up that decade, the 1970's. there was a big schism in the democratic party between people who were democrats and people

who were liberal democrats, and ultimately, the liberal democrats ended up winning. 30 years later, they lost control of the party. lisa: it is the first time now we are seeing a resurgence in the political implications of higher price inflation. what is your expectation for how this plays out in terms of that schism in terms of the midterms? wendy: i think the issue is combined with supply chain problems because people are willing to pay more for things, but to go to the verse restore our drugstore or wherever you're going to go, and it is not there. are seeing empty shelves. that i think scares a lot of people, particularly of an older generation that things about regimes that never supply their people with enough goods. even online, the wait times for things online is longer. it costs more. these two things in tandem i think scare people, and i think they see it as a sign of

decline, and they will blame the incumbent administration. kailey: the administration is trying to take action as a result, announcing this 500 million barrel release of the strategic petroleum reserve. why would president biden do that instead of encouraging show producers to produce oil? wendy: i think it is a diplomatic choice. you are aligning with countries around the world to go to bit more cover. i think a lot of people, if you talk to them at the gas pump, they will tell you they have no idea why gas costs what it does. they don't understand the supply chain. they don't understand the reserve issue. they just know they are paying $0.10, $0.15 more. they blame gas companies and they blame the incumbent administration. kailey: maybe the fact that it has taken so long to get any economic agenda through

congress. once build back better passes the senate, maybe that becomes legislation. the interceptor bill has passed. do you see his odds of getting approval higher as actually material higher, or is he going to be stuck down here? wendy: i think people are really frustrated with mask mandates, vaccine mandates. the fact that the vaccine does prevent serious illness and hospitalization in most people, but not everybody. the problem is, it is hard. that snowballs. it is very hard to get that because democrats have to have something, even if it is a complete stripped down bill. they have to show that they can govern because if they don't, they will lose suburban voters, and if they lose them now, it is very hard to win them back, even if things get better. tom: thank you so much, professor schiller at brown university. we have to do this again.

we need to get back to the news. lira has come in from four standard deviations on euro-lira into a pretty classic three standard deviation move on dollar-lira, so stronger lira in the last hour. lisa: mark mccormack talking about how there's very little liquidity in that. there is a larger story of emerging markets trying to fight stronger dollar, fight inflation, and fight potential capital flight as the u.s. continues to look like the strongest in the pool. that seems to be an issue that is affecting the likes of mexico, brazil, and argentina. tom: we don't want to be inflammatory here, but kailey leinz, capital flight actually has a little bit to do with this as well. that plays into it with these abrupt moves. kailey: it is a question of, can you actually be invested in turkey right now? because when you have erdogan,

who has been a self-proclaimed enemy of high interest rates, at the helm, even if the central bank acts, you don't have the competence that the current governor is going to remain in his position, so it makes the invest in thesis very difficult. you can't necessarily have any confidence in the monetary policy response or the pricing of turkish assets. tom: equities a churn this morning. let me move the "surveillance" cursor here. the nasdaq moving 0.8%. in the yield space, we had an abrupt move earlier with the two-year bond, with some curve flattening as well. oil, $79.91 a barrel on crude. lisa: you always dismiss the auctions. the auctions this week have been very interesting. today's seven-year option -- tom: stop the show. lisa: 30 year auctions tend to be the most complicated and difficult, and we are looking at a seven year yield that is the highest right now going back to february of last year.

it is interesting times. tom: it is interesting, and the seven year yield is of course the belly of the curve. [laughter] lisa: thanks, tom. very helpful. tom: we will be back on tv, and hear on radio. this is bloomberg. ♪

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tom: 30 year bond with the emotional print of 2.00%. the president statement on the release of part of the strategic petroleum reserve. west texas intermediate from the 80 level down to 76.65% -- down to $76.65. down fractionally. michael feroli, chief u.s. economist at jp morgan.

i am fascinated by the numbers we have, how disjointed they are in our political debate. let's start with the atlanta gdp number which is 8%, or let's take real gdp plus inflation, which is the nominal gdp and would make china happy, or let's look at real gdp run rate of 2.2%, down near the famed michael feroli potential gdp. how much of this nation is flat on their back in a weak economy? michael: not much. the unemployment rate is now 4.6%. that seems to be moving lower. the labor market, which is probably the most important market looks pretty healthy. inflation has been a problem. it will continue to be a problem in the fourth quarter. i do not expect that to persist to the same to grade next year.

i do not think many people do. there are problems, but i think it would be extreme to say the economy is flat on its back. real gdp is at peak levels, back to the trend we were on before the pandemic, which was a pretty good friend. tom: a lot of politicians are saying it is flat on the back, they are centered on inflation. so much of that is the demand for wage growth, and then inflation-adjusted wage growth. can jp morgan model we would see wage growth somewhere in the distance? michael: i think real wages will be growing next year, in part because as headline inflation comes off we know nominal wage growth looks like it is on a good trend. all you need is moderation in things like food and energy prices to start to see real wages pick up. one of the interesting things that is little noted as the labor share of national income

continues to be on an uptrend recently through the pandemic. i think it is a good period for workers. workers are getting the wage raises he would think would occur in a labor market like this. lisa: this is why we are seeing traders bring forward their expectations for the fed to asked -- for the fed to act next year versus 2023. last week you said you do expect a rate hike next year starting in september. what did you see that changed your view on how the fed will respond to this? michael: the most important development is over the past four months in employment rate has gone down 1.3%. we know the fed, beginning with chair powell, sees persistent inflation being driven by slack or the lack of slack. that is moving in a direction

that suggests we are getting close to full employment. that is last remaining condition for liftoff. having obtained that condition, i think we could see that in the second quarter of next year, i think it is only a matter of time before they lift off and try to get back to something more of a normal policy-setting because the labor market and inflation -- inflation is not looking normal but the labor market is getting back to normal. lisa: what is a normal policy rate right now? michael: first you would have to say what is the neutral real interest rate. i would think it was somewhere between 0% and 5%. that would put nominal interest rates at something like 2%. until something breaks in the economy, the fed would seek to get back to that, in measured steps, unless there is a real problem. that is the goal in terms of normalization of policies, short-term rates back to

something in that range. kailey: you also have a number of policymakers saying we need to taper more quickly than initially thought. you expect an accelerated taper and does that have any bearing on liftoff? michael: cannot rule out given the pace of improvement in the labor market recently. i think is interesting that you have a remark from richard clarida to last week. he knows he is out the door and perhaps he feels he can speak freely. perhaps he can speak on behalf of the institution. the fact that he was out there raising that idea suggested is something we cannot rule out. i do not expect to see that in december. i think it pays them to wait a little bit to see if there is a seasonality before making that decision. if it looks ok in january or march i think that is a wide possibility. lisa: larry summers says get the taper over with within three months. is that too quick?

michael: right now i think it is little too quick, but there is a case to be made for that. on your last question, the idea is you do not want to be hiking at the same time you are tapering. you want to get the taper done. as soon as you get the taper done you have the optionality to hike development next year turns out to be hotter than currently anticipated. right now, particular with the risk of a winter wave, it might be premature. as we get into early next year, that bears reconsideration. tom: 2% inflation. i want to go to your claimed seminar you hold every year, and part of that debate will be around adam posen, peterson institute, and the idea of a 3% level instead of 2%. why can't we go decimals and are we doing that right now and that the new 2% is 2.2% or 2.3%.

are we job owning our way to that level -- are we jawboning our way to that level? michael: i do not think we can go to 3% for political reasons. the fed, that they interpreted 2% in the 1990's was sleight-of-hand on the congressional mandate. some might say the flexible average inflation targeting was a backhanded way of raising the inflation target. i think there's something to that. on average there should be higher realized inflation. decimal points, given the imprecision of how we measure inflation, that might be a bit much. going to 3% is not in the cards anytime soon. lisa: i want to finish where we began the show, with tom asking a good question. are we just following hysteria with respect to an asian with these 1970 -- two inflation with

these 1970's comparisons? what is the consequence of the inflation we are seeing now? is it a longer-lasting higher inflationary environment or will we see growth materially slow and a bigger diversions between the haves and have-nots? michael: 1970's comparisons, i agree, are hysterical. the central banks around the world have learned the lessons of that period that did not happen overnight or one year, it happened over the course of the late 1960's into the 1970's. the bigger risk is the fed does get caught with inflation that is not transitory, that is persistent. i think they will do the right thing, which is tighten policy until growth slows enough to ring out the inflationary pressure. the risk is for whatever reason, it seems like anytime you slow the economy to a certain point, it is hard to slow the economy

to the right level. when you slow it it tends to tip into recession. the worry is not that we have 1970's inflation, but when the fed realizes inflation is more persistent, they have to catch up to the curve and in doing that they could tip the economy back into a downturn. tom: michael feroli, thank you so much for for joining today with j.p. morgan. when you have big news, sometimes those experiences come out with a trade. bart malic, a great guy in commodities, he says opec is in charge. he says guess what, he is long brent crude. he does it through along brent spread, i will not go into the dynamics. the answer is he goes long brent crude this morning. lisa: the idea opec will just reduce production in response because they want prices to be higher than where they are right now. that is the unknown.

what is the price opec-plus would like to see and what is the issue with respect to geopolitics, especially after the cop 26 discussion, the fact that we just came off those discussions about trying to remove fossil fuels and out as a battle for trying to continue dependence on them. tom: nicola sturgeon saying no to the campbell oil field we talked about. i think it was a telegraph at this comment may the times of london, who said we will get our oil from norway. the politics continues. kailey: the politics and the contradictory nature of pursuing green energy and climate goals on one hand, but also faced with the challenge of higher gasoline prices and trying to offset that. i wonder if that what was in the plate just cap -- what was in play in the biden administration to tap the strategic reserve? tom: the abramowitz offspring

having sell orders at $100 a barrel. lisa: actually my oldest wants to be a bitcoin trader. we'll be carrying the conversation forward about fed chair powell. tom: we are not doing a special today? lisa: not that i have heard of. bill kemp rally is joining us on the open. i'll be carrying on that conversation for jon ferro. tom: dxy 96.49. turkish lira comes in 12.66. stay with us on radio, on television, this is bloomberg. ritika: there has never been up ordinate attempt like this to bring down oil prices. the u.s. will release 50 million barrels of crude from its strategic petroleum reserve. china, india, and south korea

will also increase some of their stockpiles. the latest coronavirus wave in the u.s. is taking its toll on some states intensive care units. several parts of the country are outbreaks as bad as ever. state -- patients with confirmed or suspected covid are taking up more icu beds than a year earlier. michigan has the highest rate per capita in the u.s. in germany berlin is imposing restrictions aimed at curbing the latest covid search. those not vaccinated or recovering our band from nonessential stores or hotels. those who are vaccinated need to be tested to go to places like restaurants and nightclubs. it is one of the most rheumatic policies from a finance term. u.k. fintech asking bankers to

move to a four day work week. no change in salary. shares of zoom are lower. the video conference reported a smaller than expected number of large companies. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am ritika gupta. this is bloomberg. ♪

>> there is zero credibility and how the government will manage its finances and zero

credibility and how central banks will operate within that framework. the market has lost confidence. when we get to these pressure points it becomes a not linear rather than a linear discussion. tom: mark mccormick of td securities. at that moment the turkish lira in a four standard deviation freefall. that is reversed. the headline explains mr. erdogan has left -- has met with the central bank head to discuss the lira. from 13.50 212.56. less of a challenge than what we saw an hour ago. damian sassower our with us with his wonderful knowledge of em. i want to paint the picture of it is temple of another time and place where there was the saint regis hotel in the burgeoning international excitement and at

the top was a rooftop deck and wolfgang puck's restaurant and all of the other excitement. it is gone. what does a cratering currency due to an economy? what does it do to your financial city? damian: you're asking two questions. harkening back to a prior lifetime, turkey was a vibrant economy. they had electronic shareholder and voting and convocations. that is a different story. in terms of what is the weaker lira made to the economy, the central bank is useless in its attempt to stimulate growth. confidence had been lost for a long time but at least people were still transacting, they are no longer doing that. locals are off the market. 11 straight days of negative returns, down 43% year to date. the good news is it is only down 30% if you do not count some of the kerry.

-- some of the carry. tom: to prepare for damian sassower i looked at ecuadorian currency as it unraveled, the financial crisis. turkey is not ecuador. it is a real country. what is the path for those who want to assist mr. erdogan, even if he does not want assistance? damian: unfortunately the markets are now preparing for the fact there needs to be a change at the top. i did not see that happening before the elections in a few years. this will be a wait and see and the economy is suffering. far be it from me to tell the crt what they need to do. with -$36 billion, they do not have positive dollar reserves, they have -$36 billion, meaning they have no ammunition to stop

what is going on. that is why we are seeing these binary moves to the upside. kailey: is dollar lira through 1255 reflected a 20% inflation rate, or is that now just no confidence in the ability of monetary policy to accomplish anything in turkey? damian: is that where we are? you're absently right. forget about the number of the currency. nobody is dealing with it. speculators are not speculating. their capital controls in place by istanbul to prevent speculating. it means there's not a clearing price for the currency. whether the price is 10, 11, 12, 13, far be it from you and i to decide. the market needs to find a clearing price because there's no credit ability there and that is the real issue. kailey: is this a full-blown currency crisis? damian: it is a currency crisis

but whether it is a banking crisis, that is not where we are get. the big banks still have backing. there counterparties are not showing the way from them, there counterparties being the big european banks. let's look at what is going on across the emerging-market currency complex. it has not been a good month. it is not just the lira. it is across the board. a lot of that has to do with the euro. if you look at euro-dollar, it is the shortage of collateral, the shortage of german and french t-bills which is forcing euro investors to drop money in the dollar. tom: you mentioned collateral. two adults like you, that is what this is all about. the word collateral is trust. you mentioned bbva, and they mentioned they still want to stay in turkey.

where is the trust system in banking in turkey? damian: there is not. for me there is none. it is waiting for ghetto -- it is waiting for gadot, waiting for a change. what trust comes down to is how is erdogan's relationship with biden going to be? we talking about a migrant crisis in syria? 4% of the turkish population is now migrants from syria. these are serious issues. if the u.s. and turkey can work more closely, that may give a little bit more. tom: what are we doing to support him if he does not want to be supported? damian: it is not the federal reserve nor the u.s. government's job? it is really the job of the turkish central bank to generate credibility and encourage foreign investors to move their money and invest in that country.

unfortunately the credibility has been shot. the market is waiting for change at the top for credibility to change. tom: damian sassower with bloomberg intelligence. it shows the interdependency of mr. erdogan's stance on policy. kailey: the so-called enemy of interest rates. he has gone through how many central bank governors? the current one has only been in his role for several months, and last month we saw officials ousted because they were not supportive of cutting rates. the question becomes even of the central bank reacts to moves in the lira, as long as erdogan is in power do we keep getting a repetition cycle? tom: i think of the bloomberg presence in istanbul years ago, that bureau in the discussion we had with mr. erdogan when he was on top of the world. then for whatever set of reasons it has evaporated. on oil, what we will look for?

$80.19 on brent. kailey: we will look for any response from opec-plus. that seems to be what the market is betting on. no matter how many reserve releases happen from the u.s. and other countries, opec-plus can swoop in and decide they will not release more. either that or a lot of this has been priced in because this is been telegraphed for many days. tom: a data check into the next hour. lisa abramowicz on television. i'll be on radio with paul sweeney. critically for me, the 30 year bond 2.00%. a nuanced day in the fixed income market. the real yield from a negative 1.10 over the last number of days to a -.98%. look for jon ferro friday on "the real yield." looking forward to that. on euro, 1.1252.

leaving you with lira, 12.50 on turkish lira. coming up at 12:00, richard haass with david westin. this is bloomberg. good morning. ♪

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lisa: 30 minutes until the start of trading, a softer tone as people reassess a more hawkish fed.

the countdown to the open starts right now. >> everything you need to get set for the start of u.s. trading. this is "bloomberg: the open" with jonathan ferro. lisa: we begin with the big issue, chairman powell's next chapter. >> this is a don't rock the boat move. >> there will certainly not be any conflict. >> elevating the voice of lael brainard to vice chair is important, while keeping the continuity of jay powell. >> we are at a point where stability is important. >> this is the central case markets expected. >> the announcement will give markets more confidence to move ahead. >>